Author: Matthew Weal, Associate, Real Estate Dispute Resolution, London
It is of course open to landlords to grant their tenants express rights to light as leasehold easements. Similarly, an easement of light in favour of a tenant may be implied by means of the deeming provision in section 62 of the Law of Property Act 1925. However, more frequently, leases contain wording which will actively seek to prevent tenants from asserting a prescriptive right to light. In this post we examine some example provisions which prevent such rights arising.
These provisions will aim to prevent tenants asserting a prescriptive right to light against:
- their own landlords where the landlord owns adjoining land over which the tenant is asserting a right to light;
- third parties if the adjoining land is owned by such third party; and
- their landlord's other tenants.
The reason for needing such preventative wording is because, just as freehold owners of land or landlords can acquire rights to light under section 3 of the Prescription Act 1832 (the "1832 Act") (ie by 20 years of uninterrupted enjoyment of light before any court proceedings are issued), tenants also have the ability, in certain circumstances, to claim prescriptive rights to light under the 1832 Act over the land that surrounds their demise.
The potential claim of a tenant's prescriptive right to light can have significant effects on a development scheme, in terms of both delay to the development timetable and often with substantial associated legal and surveyors fees being incurred. In order to prevent tenants' prescriptive rights potentially affecting future development plans, it is therefore important for developer landlords to ensure that any well-drawn leases granted to tenants should contain some (preferably all) of the following example provisions which are aimed at preventing such rights arising in the first place:
1. The lease should reserve all light to the landlord and contain an express reservation of the landlord's right to develop its adjoining land "as it thinks fit" or "whether or not it interferes with the light enjoyed by the land conveyed": the purpose of this clause is to make it clear that the landlord can do what it wants on its own land. Otherwise, there is the potential for a tenant to affect a landlord's future development plans for its retained land if the tenant's prescriptive right to light was substantial. Whilst there is an implied covenant by the landlord in any lease against derogation from grant (ie a landlord cannot make the demised premises unfit for purpose by means of its adjoining development) the point of such a clause is more about demonstrating that the landlord has the ability to affect the tenant's right to light in a significant way without repercussion from the tenant. The clause also stops the tenant from inheriting any other rights to light that the landlord may already have acquired before it granted the lease to the tenant. That is important for the landlord because the tenant might otherwise seek to share in any release fee for damages from a neighbouring developer, that might otherwise go only to the landlord.
2. The lease should also prohibit the tenant from enjoying any light other than by the consent of the landlord: the 1832 Act provides that prescriptive rights can only be acquired if the enjoyment of the light was without consent or agreement of the owner of the servient land in writing. When coupled with the above provision which positively entitles the landlord to build on its adjoining land as it thinks fit, a provision in the lease that the tenant is only enjoying its right to light by the consent of the landlord will help to defeat a tenant's claim to a prescriptive right to light if the tenant's lease continues towards 20 years when prescriptive rights accrue.
3. The lease should prohibit the tenant from making any agreement concerning the right to light without the consent of its landlord: this not only helps to demonstrate that the tenant does not have a right to light in its own capacity as tenant, but it also helps prevent the tenant from negotiating independently with adjoining third parties who may assert their own right to light as against the landlord's retained development land.
4. The lease should require the tenant to inform the landlord of all and any notices served upon it, including light obstruction notices, and to inform the landlord of any attempted infringement of light which benefits the demised premises: for the reasons stated above, the landlord needs to be sure that its own retained land is not affected by a third party's claim and in order that it can seek its own legal advice as soon as possible in such circumstances.
5. The lease should prohibit the tenant from stopping up any windows: even if the landlord has prevented a tenant from acquiring its own prescriptive right to light, a landlord will not want its reversionary interest in the premises to be affected by the tenant's own actions. Once the tenant has moved out of the premises at the end of its term, the landlord will not want its own potential prescriptive right to light for the premises to have been affected by the tenant having stopped up the windows.
For more information please contact:
Matthew WealAssociate, Real Estate Dispute Resolution, London
+44 20 7466 7535